Smoking among women is a substantial U.S. public health problem that is highly associated with socioeconomic status, especially low educational attainment. It is also a direct contributor to health disparities. For example, smoking prevalence in the U.S. exceeds 30 percent among women with < 12 years of education compared to less than 6 percent for women with graduate degrees. Smoking prevalence among disadvantaged mothers is at strikingly high levels (40-60 percent). Disadvantaged women begin smoking at an earlier age, are heavier smokers, and are more likely to be nicotine dependent and to fail at smoking cessation. Not surprisingly, disadvantaged women are also at increased risk for smoking-related adverse health outcomes, including adversely impacting the health of their children through in-utero and second-hand smoke exposure (SHSe). Despite widespread awareness of the adverse health consequences of SHSe, almost 85 percent of U.S. children from low-income families are chronically exposed. SHSe, especially from maternal smoking, increases risk for infant death, chronic respiratory infections, asthma, and other longer-term medical problems, and is estimated to increase direct medical and life-lost costs in the U.S. by > $5 billion annually. Efficacious interventions to increase maternal smoking cessation and reduce childhood SHSe are sorely needed. In this application we are proposing to test the efficacy and cost-effectiveness of an intervention for promoting smoking-cessation among economically disadvantaged mothers of young children (< 11 yrs) that is based in the conceptual framework of behavioral economics and uses financial incentives to motivate behavior change. We are proposing to conduct a randomized controlled clinical trial comparing (1) usual care for smoking cessation and reducing SHSe among children, (2) usual care combined with financial incentives for objectively verified smoking abstinence and (3) usual care combined with financial incentives and also with nicotine replacement therapy (NRT) using innovative procedures to enhance medication efficacy. We hypothesize that both interventions involving financial incentives will increase biochemically-verified smoking abstinence in mothers and decrease SHSe in their children, but that the largest and most cost-effective treatment effects will be achieved by combining financial incentives with NRT. Behavioral-economic measures of decision-making biases and cigarette-price sensitivity will be examined as predictors of treatment response. Overall, the proposed study has the potential to advance knowledge on efficacious, cost-effective smoking cessation for maternal smokers and protection against SHSe in children. The study also has the potential to impact policies and clinical practices regarding recommended care for combating chronic SHSe in disadvantaged children.